Melbourne developer <a href="https://www.apartments.com.au/developers/pdg-corporation">PDG</a> has unveiled its vision for the former Water Tank Site in Ivanhoe, which would see it transformed into a thriving residential neighbourhood, complete with a 2000 sqm public park.&nbsp;

Delivered in partnership with <a href="https://www.apartments.com.au/developers/development-victoria">Development Victoria</a>, the proposal would transform the prominent corner of Bell Street and Upper Heidelberg Road into a connected community comprising two residential buildings, generous public open space and shared amenities.&nbsp;

The vision includes 287 one, two and three-bedroom apartments, with a minimum of 10 per cent allocated to affordable housing, alongside a 2,000-square-metre publicly accessible park featuring a children's playground, activity lawn, indigenous planting, timber climbing logs, seating areas and a rock gathering circle.&nbsp;

Designed by <a href="https://www.apartments.com.au/architects/dko-architecture">DKO Architecture</a>, the proposal draws on the site's industrial heritage, using a robust architectural language that references the former water tank through expressive structural elements and durable, self-finished materials.&nbsp;

Extensive landscaping has been woven throughout the development, creating a living landscape that strengthens connections to nature while responding sensitively to the surrounding neighbourhood. Two residential buildings ranging from three to 12 storeys are linked by a landscaped forecourt, creating a welcoming arrival experience and improving pedestrian connections through the site.&nbsp;

Residents would also enjoy more than 1,000 square metres of communal open space, including barbecue and dining facilities, vegetable gardens, landscaped seating pavilions and a dedicated coworking space.&nbsp;

PDG Founder and Managing Director Vince Giuliano said the vision reflected an opportunity to transform one of Ivanhoe's most recognisable sites into a place that balanced housing, community and landscape.&nbsp;

"This is an opportunity to reimagine an important site and create a neighbourhood that delivers lasting benefits for Ivanhoe," Giuliano said.&nbsp;

"We're creating much more than new homes. The vision brings together affordable housing, quality architecture, meaningful public open space and shared places that encourage people to connect, while respecting the site's history and its place within the local community."&nbsp;

Development Victoria’s Executive General Manager Precincts, Niall Cunningham, said the application is an important step for the government-owned site.&nbsp;

“This is about delivering more homes in a well-connected location, along with public open space that the Ivanhoe community will benefit from for years to come,” Cunningham said.&nbsp;

PDG was selected as development partner in late 2025 following a competitive tender process.&nbsp;

A planning submission for the project is currently being progressed through the Victorian Government's Development Facilitation Program, with positive early engagement from both Banyule Council and the Department of Transport and Planning.

Joel Robinson

PDG unveils plans to transform landmark Ivanhoe Water Tank Site

Shane Wilkinson's <a href="https://www.apartments.com.au/developers/pace-development-group">Pace Development Group</a> has lodged plans for a major residential precinct on the former Presentation College site in Windsor, with an eight-building masterplan ultimately rising to 10 storeys.

The proposal at <a href="https://www.apartments.com.au/new-apartments/167-dandenong-road-windsor-vic-3181">167–187 Dandenong Road</a> spans a substantial 19,027 sqm site and is being progressed across six stages, with the first residential stages comprising 170 homes across four buildings designed by <a href="https://www.apartments.com.au/architects/cera-stribley-architects">Cera Stribley</a>.

Stage Two will deliver the bulk of the initial housing, with Building A comprising 81 apartments and Building B 49 apartments, both rising to six storeys.

Stage Three will deliver a further 40 homes. The heritage Nagel Building, identified as Building C, will be converted to 12 dwellings, while a new five-storey Building D will comprise 28 apartments at the Hornby Street and Dandenong Road corner.

The 170 homes across Stages Two and Three will include a mix of one, two and three-bedroom apartments, including townhouse-style dwellings.<img alt="First look: Pace plans landscaped housing precinct on former Windsor school site" data-entity-type="file" data-entity-uuid="83c56e3e-dfb9-4e12-b172-c3f18513ec32" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Article%20Feature%20Image%20%28Grid%29_9.png?VersionId=xRcRpSZsxX.UX_NDDGcRZktw7HVrzx7u" />

&nbsp;

The longer-term masterplan points to considerably greater density across the site.

Indicative plans show Building E accommodating around 80 dwellings across up to 10 storeys, while Building F is earmarked for around 120 dwellings and also up to 10 storeys. Building G is planned to range between four and 10 storeys, however its apartment yield is yet to be determined. That means the masterplan currently identifies at least 370 dwellings across Buildings A to F before any apartments within Building G are counted.

Across the 1.9-hectare site, that represents an indicative density of at least 194 dwellings per hectare, with the final figure to increase once the yield of Building G is established.

Pace is pursuing the project through the Victorian Government's Development Facilitation Program, with Urbis lodging a combined Section 96A planning scheme amendment and planning application on behalf of the developer, which secured the site earlier this year.

The application seeks detailed approval for Stages One, Two and Three, alongside approval of the broader masterplan framework that will guide the later residential stages. Stage One will see an existing heritage building adaptively reused for a wellness and fitness-related facility, while the broader precinct will retain several significant heritage buildings and established trees as part of the redevelopment.

A minimum 10 per cent affordable housing contribution is proposed across both the initial residential stages and the later masterplan stages, delivered through a discounted rental model.

The project comes immediately after a major change to the site's planning controls.

The site was rezoned to the Housing Choice and Transport Zone through Planning Scheme Amendment GC285, gazetted on July 22, 2026, and now sits within the inner catchment of the Windsor Station precinct under the State Government's Train and Tram Zone Activity Centres Program.

While the new controls identify large sites within the inner catchment for buildings of up to six storeys, Pace's masterplan pushes height to 10 storeys in parts of the site, with the taller buildings concentrated toward the centre and along the Sandringham railway corridor.

Lower-scale built form is proposed toward the site's more sensitive residential and heritage edges, with Buildings A and B generally stepping from three storeys at their interfaces to six storeys at upper levels.

Cera Stribley's masterplan breaks the development into a collection of separate buildings rather than a continuous built form, with landscaped spaces, new pedestrian links and a new publicly accessible road forming part of the precinct.

The planning report says the development will create new pedestrian connections to Elm Place and along the railway corridor, as well as a new publicly accessible road linking Elm Place with Dandenong Road. The proposed buildings will occupy around 54 per cent of the site, leaving a substantial portion available for landscaping, communal areas and permeable surfaces.

Urbis said the scale of the project reflected the site's strategic location close to Windsor Station, tram services and the Chapel Street Activity Centre, with the former school campus identified as a significant opportunity to increase housing supply on an underutilised inner-Melbourne site.

&nbsp;

First look: Pace plans landscaped housing precinct on former Windsor school site

<a href="https://www.apartments.com.au/developers/jl-place">JL PLACE</a>'s Veil Brighton is approaching its final months of construction, with the nine-townhouse development at 17 Rooding Street expected to complete in December 2026.

The milestone is bringing the boutique project closer to becoming a finished part of the <a href="https://www.apartments.com.au/developments/brighton-vic-3186">Brighton</a> streetscape, with much of Brighton's everyday amenity within a short walk.

Palace Cinema, Coles Supermarket and North Brighton Station are all around five minutes on foot from <a href="https://www.apartments.com.au/new-townhouses/veil-brighton-17-rooding-street-brighton-vic-3186">Veil</a>, alongside numerous cafés, restaurants and bars. The station provides a direct rail connection toward Melbourne's CBD, while Bay Street and the wider Brighton retail and dining network add to the range of services accessible without relying on a car for every trip.

"The location was fundamental to the project. Brighton is an established suburb where many buyers already have strong connections to the area and want to remain close to the people, places and amenities that form part of their everyday life," the developer said.

"Veil sits in a highly walkable part of Brighton, with a Walk Score of 90/100."

For buyers looking to right-size within Bayside, that level of walkability adds to the appeal of a more manageable way of living. Everyday shopping, dining, entertainment and public transport can be accessed without relying on the car for every trip, while residents remain connected to the places and routines that make Brighton familiar. It allows buyers to simplify day-to-day life without giving up the convenience, amenity and connections they already value.

[smartcode_project:default project_id=7877 project_image_fid=355754]

As completion approaches, the architecture, landscaping and material palette are progressively becoming visible on site, giving prospective purchasers a clearer view of the finished development beyond its plans and renders.

Veil comprises nine townhouses, predominantly three-bedroom homes with between 2.5 and 3.5 bathrooms, two car spaces and, depending on the residence, study areas and private outdoor space. Selected homes include a bedroom on the ground floor.

Veil occupies a middle ground between detached housing and apartment living, retaining private gardens, storage and secure parking within a more manageable residential format.

<a href="https://www.apartments.com.au/architects/schmidt-pang-architects">Schmidt &amp; Pang</a> designed the architecture around natural light, ventilation, privacy and practical use of space. From Rooding Street, the façade has been composed to read as a cohesive residential building rather than nine individual townhouses, with landscaping by <a href="https://www.apartments.com.au/landscape-architect/john-patrick-landscape-architects">John Patrick Landscape Architects</a> integrated throughout the site.

Inside, natural stone, oak flooring, integrated joinery and brushed nickel finishes establish a restrained material palette, while kitchens include Miele appliances and substantial storage such as pantries. Walk-in robes and dedicated study spaces have also been incorporated across the collection.

[smartcode_project:default project_id=7877 project_image_fid=355852]

The project team said the planning of the homes has been informed by how the spaces function for both daily routines and larger gatherings.

"Our new homes owners at Veil have enjoyed the attention to detail in creating efficient layouts that use every space well. Hosting Christmas lunch and large family gatherings is an ease when care is taken to consider how people really live and entertain."

Private landscaped gardens extend the living spaces outdoors, while secure basement parking and bicycle parking are provided below. The homes have also been designed to achieve a 7-star energy rating, supported by double glazing, high-quality insulation, natural ventilation, LED lighting, water tanks and water-efficient fittings. Each residence is backed by a 10-year building guarantee.

Veil is being built by <a href="https://www.apartments.com.au/builders/jeniton">Jeniton</a>.&nbsp;Limited-time stamp duty savings are also currently available on selected purchases at Veil, adding another consideration as the project moves toward completion.

[smartcode_project_cta:default project_id=7877]

Veil Brighton nears completion in one of the suburb's most walkable pockets

<a href="https://www.apartments.com.au/developers/mosaic-property-group">Mosaic Property Group</a> has recorded 134 sales worth just over $400 million in two months of pre-release activity at The Riversdale, as the developer brings its $750 million South Brisbane riverfront project to the broader market.

The sales represent more than 60 per cent of the project's 213 apartments, with Mosaic reporting the majority of purchasers have been local owner-occupiers and downsizers.

<a href="https://www.apartments.com.au/new-apartments/the-riversdale-by-mosaic-south-brisbane-91-montague-road-south-brisbane-qld-4101">The Riversdale</a> will rise 39 storeys from its north-facing site at 91 Montague Road, delivering a mix of two, three and four-bedroom apartments alongside a collection of Mosaic's premium Masterpiece Series Sky Homes.

[smartcode_project:default project_id=151614 project_image_fid=371872]

The early buyer response comes ahead of the wider evolution of the northern end of Montague Road, where The Riversdale will be one of the first major residential projects delivered within an emerging riverfront precinct.

Directly adjoining the development is a planned 7.1-hectare mixed-use precinct, set to introduce new residences, parkland and public realm along the river's edge. The Riversdale's position directly on the Brisbane River gives it a relationship with the waterfront that Mosaic says cannot be replicated by future buildings within the precinct.

The site is also the result of a years-long pursuit by Mosaic. The developer first earmarked the <a href="https://www.apartments.com.au/developments/south-brisbane-qld-4101">South Brisbane</a> property in 2018, reflecting what Founder and Managing Director Brook Monahan has described as a deliberately patient approach to acquiring development sites.

[smartcode_project:default project_id=151614 project_image_fid=372083]

"We aren't opportunistic," Monahan previously told Apartments.com.au.

"Every site purchase is carefully considered. As seen with Kangaroo Point and South Brisbane, it can take years to eventuate. There are sites we're looking at now that we may not secure for several years."

Designed in collaboration with <a href="https://www.apartments.com.au/architects/bureauproberts">Bureau Proberts</a>, The Riversdale has been shaped around the qualities of the riverfront site, with apartments oriented to capture northern light and uninterrupted Brisbane River views.

Generous floorplans and expansive balconies extend the living spaces towards the river, while natural materials and a restrained interior palette have been selected with longevity in mind.

[smartcode_project:default project_id=151614 project_image_fid=371890]

Residents will have access to a level of amenity more commonly associated with world-class hotels and private members' clubs, with almost 3,000 sqm dedicated to wellness, connection, recreation and everyday convenience.

At ground level is a business lounge, private meeting rooms and dedicated workspaces. Mid-tower is a wellness sanctuary featuring magnesium hot and cold plunge pools, sauna, steam room, infrared therapy facilities, a Pilates and yoga studio, and a commercial-grade gymnasium.

Crowning The Riversdale is a rooftop featuring a 35-metre swimming pool with lap lane and spa, outdoor dining and seating terraces, firepit lounges and views of the city, river and Mount Coot-tha.

A private members' club-inspired retreat offers private dining rooms, a whisky lounge, media rooms and immersive entertainment experiences. Completing the amenity offering are two hotel-style guest suites and a resident-exclusive electric vehicle fleet and car-share program.

[smartcode_project:default project_id=151614 project_image_fid=371877]

The Riversdale sits at the northern end of Montague Road between South Bank and West End, around 1.3 kilometres from the Brisbane CBD, providing access to the city's major cultural, dining and recreation precincts.

It becomes Mosaic's largest Brisbane project to date and adds to a pipeline already under construction across the city.

In Brisbane, the developer is currently delivering The Bedford and The Carter at Kangaroo Point, both of which are approaching sell-out, with a further four projects being delivered on the Gold Coast. Mosaic has completed more than $2 billion in projects since 2012 and has a further development pipeline exceeding $2 billion across South East Queensland.

Early works are underway at The Riversdale, which will be delivered by Mosaic's in-house construction division. Completion is anticipated in late 2029, with remaining apartments priced from $1.98 million.

[smartcode_project_cta:default project_id=151614]

Mosaic records more than $400m in two months at South Brisbane's The Riversdale

Lender, fund manager and apartment developer Princeton has completed <a href="https://www.apartments.com.au/buildings/marque-rockdale-602-608-princes-highway-rockdale-nsw-2216">Marque Rockdale</a>, the first new apartment development in South Sydney to provide its owners with a 10-year Latent Defects Insurance policy, the most comprehensive insurance available for a new apartment building.

The policy has been a key consideration for prospective purchasers of the 58 one-, two-, and three-bedroom apartments, strategically located between&nbsp;Rockdale Plaza and Rockdale Station.&nbsp;

Buyers have also been drawn to the fact that it is one of few new apartment developments delivered in the suburb in the last 10 years, and the only one located on Princes Highway to be set well back from the street to reduce noise. There's also a communal rooftop, a rarity in the suburb, complete barbecue facilities, landscaped seating areas, a children's play zone and herb gardens.

[smartcode_project:default project_id=136442 project_image_fid=374084]

Ray White Projects’ Matt Otway said buyer enquiry reflected the increasingly diverse and cosmopolitan population that has made Rockdale home.

“We’re seeing strong interest from a broad mix of buyers, including young professionals and people who have rented in Rockdale and the surrounding suburbs and now see Marque as an opportunity to buy a brand-new apartment in an area they already know,” Otway said.

“Proximity to the CBD and Sydney Airport is another key advantage particularly for buyers working in these locations who want the added convenience of living close by.”

Investors have also been attracted to the project, with rental yields of more than five per cent, which is considered a strong result for the Sydney market.

[smartcode_project:default project_id=136442 project_image_fid=374090]

Adding another layer to the buyer proposition is Marque's 10-year Latent Defects Insurance policy from Resilience Insurance, making it the only new apartment development in Rockdale to offer the cover.

The policy protects apartment owners against major structural and waterproofing defects for 10 years following completion, giving Marque purchasers cover until early 2036 at no additional cost.

The likelihood of defects emerging has also been mitigated through the Technical Inspection Service (TIS), which saw independent experts inspect the building at various stages throughout construction to identify potential issues during the build, rather than after the fact.

SDSS, which provided the TIS, consistently ranked the construction quality at Marque, undertaken by iCIRT-rated builder Coplex, among the best across its extensive portfolio of projects.

[smartcode_project:default project_id=136442 project_image_fid=374088]

Otway said the LDI had become a major drawcard for buyers, particularly given Rockdale has seen relatively little new apartment development over the past decade.

"Rockdale hasn't had a lot of new apartment buildings in the last decade, and has never had a project with 10-year defect insurance," Otway said.

"Marque presents a truly rare opportunity at an affordable price point, so well connected to the Sydney CBD."

One-bedroom apartments at Marque start from $735,000.

[smartcode_project_cta:default project_id=136442]

Marque Rockdale completes as South Sydney’s first apartments backed by 10-year defect insurance

Prominent New Zealand apartment and hotel operator, <a href="/developers/safari-group">Safari Group</a>, is offering up a prime investment opportunity for Australians to purchase off the plan in one of the world’s most popular ski destinations.

They recently took to market Mountain Oak Queenstown Apartments, in the growing precinct of Remarkables Park in Frankton, near the airport and at the foot of The Remarkables - the mountain range the locals like to call “The Remarks”.&nbsp;

Sydney investors have shown interest in the one, two and three-bedroom apartments that secure high-season occupancy six months over the year, primarily over summer and winter months.

They average 90 per cent occupancy across their portfolio over January, February, March, August, November and December, while shoulder season months of April, July, September and October are still occupied 70 per cent of the time, with the growing appeal of Queenstown becoming not just a hotspot for the snow, but a lifestyle destination.

Even in the low seasons of May and June, occupancy levels reach around 40 per cent.

<img alt="Safari Group’s Mountain Oak Apartments brings new investment potential to Queenstown" data-entity-type="" data-entity-uuid="" src="https://res.cloudinary.com/dz9xllyip/image/fetch/f_auto,c_limit,w_1440,q_auto/https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/field/image/Ext_Cam15_Sunny.jpg?VersionId=SJAROUM_1s.Tr5ciMk4EEj5oAt_Vewmv" />

Safari’s Safari Hotels arm can also manage the holiday letting for an investor, from the listing on holiday accommodation websites such as Airbnb and Booking.com to the cleaning and maintenance of the investment. They’ve been in the short stay management business for 15 years and offer 24/7 support for investors, an important convenience benefit for any overseas investor

Another major drawcard for Australians is that New Zealand doesn’t have a stamp duty policy - so the entry price of NZ$639,000 (AU$586,000), is all that is payable on completion.

<img alt="Safari Group’s Mountain Oak Apartments brings new investment potential to Queenstown" data-entity-type="" data-entity-uuid="" src="https://res.cloudinary.com/dz9xllyip/image/fetch/c_scale,w_580,dpr_2.0,q_auto:good/https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/313_Livingv2_WEB.jpg?VersionId=nV229fM0ZeYpoxOrX372HyGjfwY_LR8c" />

Safari is starting construction of the 141 apartments in Q2 this year, with a two-year build estimated to complete in mid-to-late 2027.<img alt="" data-entity-type="" data-entity-uuid="" height="15" src="https://lh7-rt.googleusercontent.com/docsz/AD_4nXczFpFAb7WuA6f4f9TtKWcqXyNwR8qqtakWv352ERkpqNlP3KwIo8YKxw67jZNHfpjEGIZGv5MQTbnvLZwNt8iu9IVdOrswOjCvBZ4zhSoOOLrpt6etVEZTN1gkBho0r_R72zdHNA?key=yq3daOanqHSb88QFd8jGYKdb" title="Click and drag to move" width="15" />​

The apartments will feature modern amenities and contemporary designs with expansive windows capturing sweeping views of The Remarkables mountain range.&nbsp;

Interiors are equipped with modern finishes, premium appliances, and secure electronic key-locked doors, ensuring a comfortable living experience for residents and guests alike.

With its strategic location near Coronet Peak and Cardrona Alpine Resort, as well as key retail and dining precincts such as Market Street, Five Mile Shopping Centre, and Remarkables Market, Mountain Oak offers a strong proposition for investors seeking high rental yields and capital appreciation in one of New Zealand’s most sought-after locations.&nbsp;

Queenstown’s sustained demand for visitor accommodation and rental properties is underpinned by a shortage of housing options, attracting both local and international buyers.

Safari Group offers low-touch investment proposition in Queenstown’s popular ski fields district

<html><body>
Finder.com.au’s co-founder Fred Schebesta has urged Australia’s banks to become more accountable and independent.
Speaking about the Financial System Inquiry report released over the weekend, he said that we welcomes the inquiry, which makes clear that Australian banks are not even close to being globally competitive.
“Australian banks are not even close to being globally competitive in so many ways. This is insular thinking from an insular country that needs to think about actually being globally competitive for any future chance of expanding,” Fred Schebesta said.
He went on to say that Australia needs to “stop being a little island”.
“Start earning profits not just from Australia but from all around the world. Australia could become the new global Switzerland of finance with global banks around the world,” he said.
“Comparatively, the Australian financial system is a joke – we’re isolated and currently pretty terrible at integration. There’s some huge risks, for example the big four banks are so similar in business structure that it’s crucial they take on more capital – if something comes along and cripples our economy, we’re going to see all four crumble in the exact same way.”
He said that the Inquiry is a wake up call for Australia with one of the main issues being a lack of transparency.
“It’s great to see that a key message from the Inquiry was the need for more transparency. It’s about time it was seriously recognised that guidance and disclosure needs to be improved, especially in general insurance,” he said.
“It’s not fair that some institutions purposefully hide who they are owned by because they don’t want people to know that they favour or conflict with the provider. Institutions need to understand that hiding their identity makes them untrustworthy to the public.”
He said that all financial and any advice from comparison sites, brokers, financial institutions and others in Australia should disclose their ownership structure. He also said that more disclosure around pricing is necessary.
“This will give consumers a much clearer perspective on the incentives that are driving the decisions of that entity,” explained Schebesta.
“I think consumers will start getting more independent advice which will mean better financial outcomes for Australians.”
You can read <a href="/expert-insights/finance/how-mortgage-comparison-websites-make-money">Property Observer’s analysis of how comparison websites make money here</a>.
</body></html>

jduke-EHk3XBmHkn

Australian financial system is “a joke”: Finder.com.au

<html><body>
Is Australia is having a property boom? If so, no one's told the owners of these 10 homes.
Some have had their prices slashed by more than $1 million. Others have been waiting patiently on the market for years.
According to SQM Research, these are the 10 most discounted homes in Australia.
Overvalued or underloved? You be the judge.
<a href="https://www.realestate.com.au/property-house-tas-ranelagh-113279035" target="_blank"><img src="/images/2014/07/04/yellow-one.jpg" alt="">2 Louisa Street, Ranelagh, Tasmania</a>
<img src="/images/2014/12/04/discounted%20list.jpg" alt="">
Clifton, a heritage circa 1865 property, has been on the market for 622 days. Its asking price has halved in that time, from $2 million to $995,000.
The mixed use property has a 25 bed main residence, with two separate cottages. It has at times been used as a farming enterprise and as a bed and breakfast.
<a href="https://www.realestate.com.au/property-residential+land-wa-watermans+bay-200498923" target="_blank"><img src="/images/2014/07/04/yellow-two.jpg" alt="">63 Flora Terrace, Watermans Bay, Western Australia</a>
<img src="/images/2014/12/10/image2.jpg" alt="">
This double title Watermans Bay property was initially listed for $1.45 million, but is now priced at $825,000. A house sits on the 1,012 square metre plot.
It's rented out for $600 per week, representing a yield of 3.7% at its current asking price. Subdivision plans are available on request. <a href="https://www.realestate.com.au/property-acreage+semi+rural-qld-rochedale-114981059" target="_blank"> <img src="/images/2014/07/04/yellow-three.jpg" alt="">948 Priestdale Street, Rochedale, Queensland</a>
<img src="/images/2014/12/04/2.jpg" alt="">
 A 20 paddock rural property, 948 Priestdale street has been on the market for 420 days. When first listed for sale, it had a $2.8 million price guidance.
Now, it's listed 41% lower, at $1.65 million. The property includes a three bedroom main house, multiple sheds and barns.
 <a href="https://www.realestate.com.au/property-house-tas-wattle+grove-116035107" target="_blank"><img src="/images/2014/07/04/yellow-four.jpg" alt="">78 Walters Road, Wattle Grove, Tasmania</a>
<img src="/images/2014/11/26/1.jpg" alt=""> This two titled property on 10 acres is listed at $685,000, 40% down from its initial price guidance of $1.15 million.
The property with a three bedroom, two bathroom house and a separate two bedroom cottage has been on the market for 282 days.
<a href="https://www.realestate.com.au/property-residential+land-wa-carabooda-200627671" target="_blank"><img src="/images/2014/07/04/yellow-five.jpg" alt="">292 Carabooda Road, Carabooda, Western Australia</a>
<img src="/images/2014/10/1/1.jpg" alt=""> One of two Carabooda properties on the top 10 discount list, 292 Carabooda Road has seen its price chopped by 37% in its 475 days on the market. The 7.1 hectare farm was first listed at $1.65 million, but vendors will now take $1,032,000.
The farm has a three bedroom cottage with a double garage on site.
This article continues on the next page. Please click below.
<a href="https://www.realestateview.com.au/Real-Estate/28a-malsbury-street-bicton/Property-Details-buy-residential-7962768" target="_blank"></a>
<hr class="system-pagebreak">
<a href="https://www.realestateview.com.au/Real-Estate/28a-malsbury-street-bicton/Property-Details-buy-residential-7962768" target="_blank"><img src="/images/2014/07/04/yellow-six.jpg" alt="">28a Malsbury Street, Bicton, Western Australia</a>
<img src="/images/2014/11/26/image3.jpg" alt=""> This West Australian property has also had a 37% price cut. Its similarities with 292 Carabooda Road end there. This Bicton strata unit has two bedrooms and one bathroom has seen a $450,000 price cut, from $1.5 million to $950,000.
It's rented out for $480 a week, representing a 2.6% yield at its current asking price.
<a href="https://www.realestate.com.au/property-house-tas-battery+point-108230936" target="_blank"><img src="/images/2014/07/04/yellow-seven.jpg" alt="">1/23 Albuera Street, Battery Point, Tasmania</a> <img src="/images/2014/07/09/6.jpg" alt=""> A luxury ground floor apartment in a former school house is listed at $1.4 million. Initially, it was listed a $2.2 million, more than three years ago. The timber-floored apartment has three double bedrooms. <a href="https://www.realestate.com.au/property-house-sa-mawson+lakes-113369071" target="_blank"><img src="/images/2014/07/04/yellow-eight.jpg" alt="">35 The Walk, Mawson Lakes, South Australia</a> <img src="/images/2014/12/10/mawsons%20lakes.jpg" alt=""> The most discounted home in South Australia is a four bedroom, three bathroom house in the new residential development of Mawson Lakes.
The house with a "commanding street presence" has decorated 10 foot ceilings and a lot of columns. It's been on the market for 588 days, and was initially listed at $1.8 million. Vendors will now take $1.15 million.
<a href="https://www.realestateview.com.au/Real-Estate/2-wellington-street-richmond/Property-Details-buy-residential-6093682" target="_blank"><img src="/images/2014/07/04/yellow-nine.jpg" alt="">2 Wellington Street, Richmond, Tasmania</a>
<img src="/images/2014/07/09/2.jpg" alt=""> Vendors have been trying to sell Mill House, a historic Tasmanian estate, for more than a year. In that time, its price has dropped by $1 million, from $2.8 million to $1.8 million.
The 3,450 square metre estate has a four bedroom, four bathroom main house, with a separate cottage. The buildings include convict laid brick walls.
<a href="https://www.realestate.com.au/property-house-wa-carabooda-114289451" target="_blank"><img src="/images/2014/07/04/yellow-ten.jpg" alt="">219 Bernard Road North, Carabooda, Western Australia</a>
<img src="/images/2014/10/1/2.jpg" alt="">
This Carabooda home is now listed for $2,727,000, 35% down from its initial price guidance of $3.5 million. The 15 hectare farm shares a listing agent with its Carabooda cousin further up on the discount list.
The property includes two houses, one described as being "in disrepair".
</body></html>

jrichardson-uRX5hFdKfN

Overvalued or underloved? The country’s most discounted homes

<html><body>
GUEST OBSERVATION
Having enjoyed continuously increasing prosperity since the Second World War, Australians have come to expect that each generation will live a better life than the last.
But this steady progress may be at risk. As shown in Grattan Institute’s latest report <a href="https://grattan.edu.au/">The wealth of generations</a>, today’s young Australians may end up with lower living standards than their parents at the same age.
Young Australians will bear the costs of fiscal decisions made by past and present governments. The cost of rising government spending on older households and repaying government debt will fall most heavily on today’s young.
Younger Australians have always been net contributors to the budget. Under the generational bargain, people of working age pay more in taxes than they receive in government benefits and services. They then become net takers from the budget in retirement. Strong income growth allowed each generation to take out more from the budget that they put in. But the generational bargain is now at risk.
Many expect incomes will rise more slowly in coming decades, making transfers to older households less affordable. Affordability concerns are compounded by the growing size of net benefits received by older Australians. In 2010, governments spent A$9400 more per household headed by someone above 65 than they did in 2004.
<img src="https://62e528761d0685343e1c-f3d1b99a743ffa4142d9d7f1978d9686.ssl.cf2.rackcdn.com/files/66722/width668/image-20141209-32162-12u017d.jpg" alt="">
This increase in net benefits for older households was a result of increased spending on health, higher Age Pension payments and lower income taxes.
Spending on pensions increased most with the Howard government’s changes to the pension asset test and the Rudd government’s 10% increase in the base pension rate. On the tax side, concessional superannuation tax arrangements now allow individuals above 60 to materially reduce their income tax liability, by up to $5000 a year. The <a href="https://www.ato.gov.au/Calculators-and-tools/Senior-Australians---pensioner-tax-offset/">seniors and pensioners tax offset</a> can also reduce tax payable by up to $1600.
Spending on health has risen particularly fast. Health spending per person has increased for all age groups but it increased most in dollar terms for those above 60. Increased use of services, rather than population ageing has been the main driver. For example, technological improvements allow more medical procedures to be performed safely and successfully on those who are older.
<img src="https://62e528761d0685343e1c-f3d1b99a743ffa4142d9d7f1978d9686.ssl.cf2.rackcdn.com/files/66723/width668/image-20141209-32146-vmgi8e.jpg" alt="">
Population ageing will magnify the cost of growing transfers to older households. As the baby boomer generation reaches the “draw down” phase of the generational bargain, Age Pension and government health spending will substantially increase. For example, the Productivity Commission estimates that state and Commonwealth government health spending will increase from 6.5% of GDP in 2011-12 to almost 11% in 2059-60.
Over the last six years, the increased spending on older households was funded through deficits. The cost of the increase in payments to households above 65 was about $22 billion a year. This was a substantial contribution to Commonwealth budget deficits which have exceeded $40 billion per year for four of the last five years.
The cost of these deficits will be worn by younger generations. To repay the accumulated debt, they will pay higher taxes or receive fewer government services. An annual deficit of $40 billion a year implies an additional future tax burden of around $10,000 for each younger household.
<h3>Prevention is better than cure</h3>
Government policy choices have contributed to the size of the future burden on young Australians. Other policy choices would reduce the risk of the next generation being worse off.
Targeting the Age Pension, reducing superannuation tax concessions and increasing asset taxes (such as taxes on land) could reduce the transfers between today’s younger taxpayers and older retirees. These reforms would fall most on those who have benefited from government largesse and paying lower taxes while deficits accumulated.
These reforms would also significantly contribute to solving government budget problems. Even if all the Commonwealth government’s stalled budget reforms were passed, they will be nothing like enough to bridge the budget gap. Larger scale tax and spending reforms are needed.
If government expenditures on health, pensions and superannuation concessions are cut because budgets cannot sustain them, this will also disadvantage younger Australians. Younger generations, on the wrong side of the drawbridge after the policies change, will have paid for benefits they will never get to enjoy. This strengthens the case for reforming these policies sooner rather than later, and limiting the scope of “grandfathering” provisions.
The generational bargain has served Australia well. Yet it will be undermined if some generations are asked to do more than their fair share. Reforms to pensions, superannuation tax concessions and asset taxation are needed to ensure the sustainability and fairness of the tax and transfer system. Without them, there is a real risk that our children and grandchildren will not enjoy the fruits of Australia’s prosperity as much as their parents.
John Daley is chief executive officer at Grattan Institute.
Danielle Wood is fellow, Australian Perspectives at Grattan Institute.
<img src="https://counter.theconversation.edu.au/content/35250/count.gif" alt="The Conversation" width="1" height="1">This article was originally published on <a href="https://theconversation.com" style="line-height: 1.3em;">The Conversation</a>.
</body></html>

po-LsXgBTHBmX

Young Australians set to pay for government policy mistakes

<html><body>
Recently, the House of Representatives Economic Committee Report on Foreign Investment in Residential Real Estate was released.
The report made 12 key recommendations, one of which was better funding of the Foreign Investment Review Board (FIRB), because currently there is a complete lack of creditable information on the true extent and nature of foreign investment into residential property. As might be expected the report has received a mixed response. It has not been welcomed by the majority of public comments posted on various news websites.
Let’s examine some of the background that led to the committee looking at this area of policy. In a recent post I noted that the local housing construction industry was worth almost $70 billion, employing some 1,037,412 people in 2014. When talking about foreign buyers and residential property I use these figures as a starting point to help illustrate how important this sector is as a driver of our economy, and it’s a point that was repeated in Friday’s report.
The role of foreign investment in our market can be an emotional subject, and it remains so. It is also a very complex issue for a country with a growing population and a somewhat mixed economic outlook.
The Plight of First Time Buyers
There has been clear evidence for some months now that first time buyers are being squeezed out of the housing market. Australian Bureau of Statistics (ABS) finance statistics show that in September 2009 first time buyer finance stood at 26.1%, by September 2010 that figure had fallen to 15.5%. In the most recent ABS figures there was a slight increase but the figure is now down to 12.0%, and the average loan has increased to $326,500, which in the Sydney market would not stretch that far.
Also, in the most recent ABS figures, investment finance for the month grew by 1.7% and owner occupier finance only grew by 0.1%, and this continues a long-term trend. The reasons for these trends are very complex, but on the surface, they do create an emotional picture of the plight of some sections of the housing market.
The emotion is partly illustrated by a <a href="https://www.change.org/p/the-executive-members-toughen-the-regulations-for-foreign-investment-in-australia" target="_blank">current online petition</a> posted on change.org. The petition started in response to the Economics Committee’s review which called on the Federal Government to "toughen the regulations for Foreign Investment in Australia". It attracted some 32,300 supporters (signatures) and a wide variety of mainly sympathetic followers. A key element of the petition was the fact that only 33 of the reported 5000 sales of established homes to foreign buyers over recent years have been investigated by the FIRB.
That’s a very small number and so, understandably, it makes the FIRB rules an easy target. However figures from the FIRB show that in the first nine months of the last financial year foreign residential property investment was $24.8 billion – a 44% increase over the amount approved for the whole of the 2012-13 financial year, which only further points to the fact that the FIRB may be under-resourced.
In the report the committee also made reference to these figures and agreed the FIRB was not doing an acceptable job, which it recommends be fixed.
The petition and the concerns of its sponsor (Simon Hosking) had been brought to the attention of Kelly O’Dwyer, Federal Member for Higgins and Committee Chair of the Parliamentary Business Committee’s House Economics Foreign Investment in real estate. In part of her response, published on the petition’s website and issued ahead of the main report, O'Dwyer states:
“… The Committee is taking a holistic approach to examine whether the current policy settings are delivering the best outcomes for the Australian economy and increasing housing availability, as they are designed to do. Australia’s foreign investment policy, as it applies to residential property, is intended to boost the supply of new housing and thus provide both economic and social benefits. The policy seeks to channel foreign investment in the housing sector into activity that directly increases the supply of new housing (such as new developments of house and land, home units and townhouses) and brings benefits to the local building industry and its suppliers…”
 This article continues on the next page. Please click below.
<hr class="system-pagebreak">
Blame game or market reality
The debate around foreign investment in residential property comes at a time when prices and demand have both been increasing, a very obvious trend in Sydney and Melbourne and to a lesser extent in Brisbane and other centres. These cities are also attracting the bulk of foreign buyers and foreign development capital and investment.
In part, the trend is being ‘blamed’ for higher prices and at one end of the market. That blame extends to the trend locking first time buyers out of the market.
Again, ahead of the main report, here’s what Committee Chair Kelly O’Dwyer said in response to the Simon Hosking petition. The  same views were reinforced in the main report:
“…Consistent with this principle, foreign investors are able to seek approval to purchase new dwellings and vacant land for residential development. Foreign investors cannot generally buy established dwellings as investment properties or homes; however, temporary residents can apply to purchase one established dwelling to use as their residence while in Australia. The acquisition of residential real estate by foreign investors is regulated by the Foreign Investment Review Board (FIRB). It has become clear from evidence presented to the Committee that FIRB has not prosecuted a single case since 2006. It is also clear that there are problems with processes at FIRB, resources and the penalty regime. The Committee is due to report later in the year…”
However only last week ahead of Friday’s report, this same committee knocked back a proposal that foreign property buyers be levied an extra stamp duty as a possible way of helping to fix the housing affordability crisis, and dampen offshore demand.
There seems to be a fairly entrenched ‘hands-off’ approach being adopted, although a purchase application fee of $1500, that would raise $158.7 million over four years, appears to have general support. Such a fee would by no means act as a penalty.
Returning to the idea that foreign investment is somehow having a negative impact on the market (by forcing up prices), I think we should also look at how different the Australian economy has become over the past two decades.
Because the housing market is part of a big picture and it has to be seen in the wider context. The importance of direct foreign investment across our economy is illustrated by the fact that in 1990 Direct Inward Investment Stocks was US$80,333 million, however, in 2012 that figure had grown to US$604,257 million. Over the same period Australia’s outward flow of Direct Investment Stocks has grown from US$37,491 million to US$424,489 million. I quote the figures to illustrate the fact that the international flow of investment funds is a fundamental to any economy.
The rush to secure Free Trade Agreements is further evidence of this fact. Last week Australia and China signed an FTA, and it is yet to been seen if this will have any impact on the flow of funds into residential property both buying existing projects and for new developments, and if this will be a positive or not for the market.
On first reading of the China/Australia Free Trade Agreement, because of the freeing up of many of the service sectors, this may well be a positive for Sydney and Melbourne, because these two cities are so closely aligned to the professional services. Law, finance, education, tourism, health, engineering and manufacturing are all seen as having potential benefits and growth in these areas plus other key areas should create more demand for commercial and residential accommodation in Sydney and other cities.
However, again illustrating how emotional this topic has become, there are suggestions that the various free trade agreements will further harm the prospects of ‘local’ would be home-buyers. But I do not see any foundation for this assumption.
</body></html>

pchittenden-eLqUUC8TWW

The housing market and foreign buyers: A blame game

<html><body>
A new forecasting report from Colliers International has predicted ongoing growth in Sydney, Melbourne and Brisbane through 2015, particularly with investor sentiment expected to remain strong.
Peter Chittenden, Colliers International managing director – residential, explained in the Colliers 2015 Asia Pacific Property Outlook that low interest rates will attract first home buyers and investors.
“The outlook for interest rates is mixed, but headline indicators such as unemployment, construction activity and GDP point to a period of weaker overall economic growth which will result in interest rates remaining steady in the short to medium term,” he said, noting that it will be good news for residential property and will continue demand momentum.
Supportive conditions in 2015 for investment are expected to continue.
“Sydney, Melbourne and Brisbane residential markets will have the strongest residential growth, as weaker economic conditions in Western Australia will lead to a slowdown in development and investment activity in 2015,” said Chittenden.
Meanwhile, developments in central areas, near public transport, work and retail hubs will remain in high demand.
Chittenden expects that infill apartment developments will continue to grow next year, particularly with state and local government infill policies contributing to developers flocking into the CBD and inner suburbs in Brisbane, Sydney and Melbourne.
“This is evident in the volume of new apartments being developed and approved by local councils, and the strong growth in development site values,” he said.
“The Melbourne and Sydney CBDs have been the strongest performing markets, with the volume of apartments under construction in the next five years to reach and 18,000 and 6,000 respectively, buoyed by strong offshore demand, and a rapidly rising inner city population, a trend we anticipate will continue in 2015," said Chittenden.
</body></html>

Sydney, Melbourne and Brisbane are still cities to watch in 2015: Colliers International

<html><body>
The penthouse in the landmark 1888 Biltmore, Albert Park building has been sold for $4.55 million by the so-called Saatchis of street art, edgy art collectors Sandra Powell and Andrew King.
It last sold at around $2.85 million in 2005 from the de Campo family who undertook the building's conversion from hotel premises.
It has majestic verandah archways and its interiors have 16 foot ceilings designed by architect Walter S. Law, who also designed Drummond Terrace and Medley Hall, Carlton.
One of the original streets of the 1855 Emerald Hill town plan, Bridport Street had developed slowly from the 1860s accompanied by the construction of the new railway cutting in 1857, but with a fillip with the new cable tram route in 1890.
The 40-room building was built in the free classical style as the Albert Park Coffee Palace, one of dozens of coffee palaces, part of the temperance movement, alcohol-free alternative to the public house.
The imposing four storey building with arcaded loggias became a private hotel in 1928. In the 1950s it was sold to the Royal Melbourne Hospital and used as a nurses' home, before reverting back to a private hotel in the mid-1960s.
It was refurbished and subdivided into 12 apartments in the mid-1990s.
It has majestic verandah archways and its interiors have 16 foot ceilings.
The four bedroom, three bathroom apartment comes with pool, spa and two basement carparks.
Cayzer Real Estate Albert Park agents Geoff Cayser and Michael Szulc had the listing.
Since its sale it has become available as a $3000 a week rental through <a href="https://www.domain.com.au/property/for-rent/apartment-unit-flat/vic/albert-park/?adid=9382853" target="_blank">Kay &amp; Burton</a> along with <a href="https://www.domain.com.au/property/for-rent/apartment-unit-flat/vic/albert-park/?adid=9368579" target="_blank">Cayzer</a>.
It was a $2000 a week rental in 2008.
</body></html>

jchancellor-FAypfDUnLy

Biltmore, Albert Park penthouse $3000 a week rental after $4.55 million sale

<html><body>
Investment decisions in property are often presented as choices between yield and capital gains. In Melbourne, there is a small selection of suburbs where both objectives can be met; they have above average capital gains and a yield higher than the citywide one.
As past performance is not a guarantee of future performance in the property market these are not suburbs investors should automatically buy into, rather it shows that with some astute property hunting strong investment outcomes may be found.
Over the past decade the compounding annual growth rate for a house in Melbourne was 5.77% and 5.16% for a unit. The gross rental yield over the last year for a house was 3.6% and 4.1% for a unit.
In the unit market there were 34 suburbs that recorded capital growth and with yields in excess of the citywide outcome, and five of those stood out. In the market for houses there were 33 suburbs.
The five standouts in the unit market, predominantly because of reasonable sales volumes providing opportunities for buyers, were <a href="/news">Ferntree Gully</a>, <a href="/news">Brunswick West</a>, <a href="/news">Chelsea</a>, <a href="/news">Mount Martha</a> and <a href="/news">Boronia</a>.
In the market for houses the five that stood out were <a href="/news">Bayswater</a>, <a href="/news">Altona North</a>, Boronia, <a href="/news">Collingwood</a> and <a href="/news">Mooroolbark</a>.
In it interesting to note that many suburbs in the outer eastern suburbs, around the base of Mount Dandenong, have recorded above average yields and capital gains over the past decade.
The other area of Melbourne that has multiple suburbs with good capital gains and yield is in the inner east.
Obviously the skill for an investor is not just finding the right suburb but the right property and that can take time and requires both research and a strong understanding of the local market.
</body></html>

rlarocca-zWhvjay44N

The Melbourne suburbs offering both yields and capital gains

<html><body>
Brisbane's year of recovery and the ongoing struggle of the Gold Coast unit market are standout features of the latest quarterly Market Monitor from the Real Estate Institute of Queensland.
Also noteworthy are the solid 2014 performances of regional cities Toowoomba, Cairns and the Sunshine Coast.
Despite the general uplift in market activity on the Gold Coast, the unit market is still struggling to recover from the oversupply years in terms of prices.
The Gold Coast's median unit price up 4.4% in annual terms, but still 2% below the price levels of five years earlier, according to Market Monitor.
Specific markets have yet to move into positive territory on prices. The median unit price for Surfers Paradise is 4.2% lower than a year ago and it remains 6.3% below the level of five years ago.
Broadbeach has dropped 1.7% in 12 months and remains 3.8% lower than in 2009. Main Beach has shown a 0.9% annual rise, but is still 6.7% below the price levels of five years ago.
It's a more positive story in the housing market. Most housing suburbs have recorded annual growth in median prices, double-digit growth in a few cases – and most, though not all, now have price levels above those of five years earlier.
This tallies with the trend we've notice with sales levels. There's been a steady rise in sales activity in many of inland housing market on the Gold Coast over the past 12-18 months. Prices have reacted more recently.
Another Queensland icon Noosa continues to struggle. The unit market in the Noosa LGA has dropped 1.3% in 12 months and price levels remain 7% lower than in 2009.
The suburb of Noosa Heads is still a basket case, despite the rhetoric of local agents. The median unit price dropped 12% in the past 12 months and is 29% lower than five years earlier.
This is why we refer to Noosa Heads as the biggest lemon in Australian real estate. How did this place ever get its lofty reputation with investors?
Our previous comments about the need for caution in the Brisbane inner-city unit market appear to be reflected in price data in Market Monitor. The median apartment price for the Brisbane CBD fell 10.1% in the September Quarter. Others to record quarterly decline were Kangaroo Point (down 8%), Woolloongabba (2.5%), West End (13%) and Fortitude Valley (7%).
The result for the wider Brisbane City local government area was better, with a 0.6% quarterly rise and a 5% annual rise in the median unit price.
Houses generally are doing much better. The median house price for the Brisbane City Council area rose 8.7% in 12 months, including a 1% rise in the September Quarter.
Many of the better individual performers - suburbs that out-performed the city average – are in the northside areas of Brisbane City, including Chermside (up 13%), Kedron (up 15%), Sandgate (up 12%) and Stafford (up 15%).
The more distant reaches of the Brisbane metropolitan area are showing some life, with annual growth in median house prices in Logan City (up 4.5%), Moreton Bay (up 4%) and Ipswich City (up 3.2%). I'm expecting bigger numbers from these areas in 2015.
Toowoomba's recent solid performance is reflected in the figures. The median house price rose 1% in the quarter and 7.2% over 12 months. Price levels are now 24% higher than five years ago. Units are up 8.5% in annual terms, including a 2.5% rise in the September Quarter.
The recovery on the Sunshine Coast is also evident. The median house price rose 1.2% in the quarter and is up 6.3% in annual terms. Buderim, always the most popular housing market, has risen 7% in the past 12 months.
Cairns' revival is apparent, with house prices up 6.2% and units up 7.5%. Other places showing some spark after several poor years include the Fraser Coast, flood-affected Bundaberg and the Whitsundays, including Bowen. Townsville and Rockhampton remain sluggish.
Gladstone dropped a further 4% in the September Quarter and is 8% down on a year earlier. Mackay has taken a big hit on rentals but prices are down only moderately (3.5% in annual terms).
Isaac Shire, which includes boom-bust icon Moranbah, is down 38% in annual terms, while Emerald is down 15%.
Terry Ryder is the founder of <a href="https://hotspotting.com.au">hotspotting.com.au</a>. You can <a href="https://mailto:ryder@hotspotting.com.au" target="_blank">email him</a> or contact him on <a href="https://twitter.com/hotspotting" target="_blank">Twitter</a>.
 
 
</body></html>

terryryder-YECXbqmri2

Gold Coast units still struggling, Noosa Heads still a lemon: the Queensland quarterly wrap 

<html><body>
GUEST OBSERVATION
The federal budget balance is expected to deteriorate.
The reasons are numerous but, in a lengthy statement, the government sums it up in terms of two key factors. These are: the softer economic outlook; and unresolved issues inherited from the former government.
The economy is going through a transition. A decline in resources investment will be offset by a recovery in the non-resources sector. It seems the decline in resources investment may be sharper than previously forecast while the recovery in the non-resources sector may be more gradual.
Thus, with real gross domestic product growing at a slower rate, hence “a softer economic outlook”, revenue from taxation will also be less. The result is a higher budget deficit.
The previous Labor government can apparently be blamed for many “legacy” items, but one is rather curious. Our central bank, the Reserve Bank of Australia, has to receive A$8.8 billion to compensate it for losses incurred to its foreign currency reserves during the period when the Australian dollar appreciated.
The choices faced by the government
Given the deficit prospect, the government faces three choices:
<ol>
<li>Run a bigger deficit,</li>
<li>Raise taxes, or </li>
<li>Cut government spending.</li>
</ol>
The government has already embraced choice three – cut spending. With regard to choice two, it abolished the carbon tax and the minerals resource rent tax, and thus moved in the wrong direction.
Perhaps the government will cut public spending further in areas it finds attractive. After cutting funding to the CSIRO, ABC and SBS, the staff of the federal public service, and funds available to the states for health, education and transport, not to speak of the universities, there are surely more possibilities.
Incidentally, over 20 non-statutory bodies have been abolished or rationalised. The underlying (or even explicit) philosophy is to reduce the size and responsibilities of government. This is in tune with United States conservative attitudes.
What the government should consider is raising taxes rather than further spending cuts. This is a very serious proposal. Yet, compared with the US approach, it may be more in tune with traditional Australian attitudes, which expect a great deal from governments.
Why the federal government should raise taxes
To understand the argument behind the need to raise taxes, it is important to understand what can be described as Howard’s Gift.
Under the Howard government, beginning around 2003, there was a boom in the form of rising export prices of iron ore and coal. As a result, revenue from corporation tax increased sharply.
This led the Howard government to cut personal income taxes on no less than five occasions. Also, superannuation concessions were extended. The details can be found in <a href="https://www.lowyinstitute.org/publications/beyond-the-boom" target="_blank">John Edwards’ Beyond the Boom</a>.
This was John Howard’s gift to the taxpaying middle and upper classes. It was clearly a response – perhaps understandable – to the export boom.
The trouble was it had the effect of increasing budget deficits in later years when tax revenues declined. In particular, budget deficits in the Labor (Gillard) years were increased by Howard’s Gift. Even now it has an adverse effect on the government’s budget balance.
However, as the mineral export boom in the Howard years turned out to be temporary, the income tax cuts that were motivated by the boom should also be temporary. In other words, they should now be reversed.
Personal income tax rates should be increased to where they were before the boom. Usually opposition parties oppose tax increases. Prime Minister Tony Abbott ran a very effective campaign against the carbon tax when in opposition.
So this proposed tax increase needs to have bipartisan support. If Labor gets into government later, they will be glad to have a decent revenue base for their budgets.
Article continues on the next page. Please click below.
<hr class="system-pagebreak">
Reform required for our tax system
At the same time some other improvements should be made to the income tax system. These ideas all come from the famous <a href="https://taxreview.treasury.gov.au/content/Content.aspx?doc=html/home.htm">Henry Report</a> on the Australian tax system.
The aim would be to simplify the system and, above all, to remove special concessions and deductions that principally benefit the better-off. These are the favourable concessions that affect the superannuation earnings of people on high incomes.
All remuneration should be measured as wages. Capital gains tax rate concessions and various concessions available to primary producers should also be removed.
In addition to increasing income tax rates to their earlier levels, more revenue needs to be obtained from the GST. This tax has to rise if sufficients funds are to be generated for the states’ vital functions.
There is no doubt the GST is a relatively efficient tax, but it would be more efficient and easier to collect if goods and services of all kinds faced the same GST rate. Exemptions should be avoided and, probably, the rate increased closer to comparable international rates.
However, the real problem with broadening the GST or raising the rate has to do with equity. This tax is a bigger burden for persons with low incomes than for the well-off. But equity within society is more effectively achieved with a progressive income tax and social security system than through exemptions from the GST. This means that some of the GST revenue gain should be returned to households in the form of increased social security payments and a more progressive personal income tax schedule.
It is clear that Australia’s entire taxation system needs major improvements. This is clearly shown in the Henry Report, which is a valuable guide for reform.
No doubt these matters will be discussed in the government’s prospective white paper on taxation. The government needs to raise more revenue while making limited improvements to income tax and the GST. The basic aim, above all, should be to avoid further damaging government spending cuts.
And what about a recession?
The government believes there is a “softer economic outlook”, which means we might face a recession. It is impossible to predict at this time whether this will happen. However, if there is any possibility of a recession, then it is not the time to cut government spending nor to raise taxes.
However, the government does need to implement long-term structural reform of the tax system and expand its revenue base. In the face of a recession, the RBA will need to lower interest rates and stimulate the economy and also depreciate the Australian dollar. Such stimulus would, as a by-product, partly reduce the budget deficit.
Max Corden is professorial fellow in the department of economics at University of Melbourne.
This article was originally published on <a href="https://theconversation.com">The Conversation</a>.
</body></html>

Australia needs higher taxes, not spending cuts

<html><body>
Quantity surveyors Washington Brown are warning investors not to get carried away with that holiday feeling this summer.
Over the holiday period many investors can fall into the romance of owning their own private get away. But Washington Brown says to tread carefully.
Holiday properties can be an enticing investment. Victoria’s coastal town of <a href="/news">Torquay</a> has a median house price of $617,000 and a median rental price of $400 per week, according to Core Logic RP Data.
Washington Brown says when buying a property, the ‘we have got to have it and we will make it work’ compulsion is natural. After purchase costs such as renovations and furnishing can build up and before you know it, you may have spent over $1 million on your new holiday property.
Quantity surveyor and depreciation expert Tyron Hyde says that there are way around spending a lot of time and money on holiday properties.
“Holiday houses can be depreciated if they are rented out to a third party,” said Hyde.
This stops you from staying at the house whenever you want.
“As long as it’s available for rent most of the year you can block out a two week period over Christmas and claim the depreciation pro rata,” Hyde said.
“You are still entitled to that deduction regardless of how many weeks the property is actually rented out as long as it was available for the full 50 weeks.”
“I’m seeing many clients buy holiday homes at close to, or less than the construction cost and if you furnish your holiday home, you’ll magnify the deductions.”
</body></html>

Latest Investing Insights

Safari Group offers low-touch investment proposition in Queenstown’s popular ski fields district

Editor's Picks

Developments

New apartments

New townhouses

News

Latest Investing Insights

Safari Group offers low-touch investment proposition in Queenstown’s popular ski fields district

Editor's Picks

Receive the latest news stories to your inbox

Developments

New apartments

New townhouses

News